Consumers and Online Retailers Will Face the Reality of Online Sales Tax

Do you prefer to shop online? If so, you’re among many other consumers who shop online and contribute to 10% of retail sales worldwide. Most people prefer to shop online because sales tax can be avoided, however, the Supreme Court has decided that the states can tax Internet sales, even if the retailer doesn’t have a physical presence in that state.

Previously, the retailer’s physical presence in a specific state was the deciding factor regarding sales tax. In 2008, the state of New York enacted a law that altered the meaning of “physical presence” to include affiliates of online retailers.

Online sales are growing at a rapid rate and states depend on sales tax as a source of revenue. The problem is, it’s difficult for online retailers to adhere to the sales tax system. Congress is trying to create a more uniform system to manage sales tax for online sales across the country, and ultimately, online sales tax will most likely become a reality for consumers and online retailers alike.

To learn more about online sales tax, give us a call at (831) 753-76-77 or send us an email at [email protected]. Alvarez Technology Group can help you stay up to date on the online sales tax laws in your state.